The European commission got the green light from Europe's second-highest court yesterday to pursue even more high-profile antitrust actions against dominant global companies.

In a landmark ruling making the commission the leading competition authority in the world, the Court of First Instance comprehensively threw out Microsoft's appeal against a March 2004 EU decision to fine it a record €497m (£345m) and force it to share with rivals information about its Windows operating system.

The court upheld the commission's decision that the software group had also abused its dominance by illegally "bundling" its Media Player software into Windows.

It was a long-awaited and surprisingly one-sided judgment - delivered in less than four minutes in Luxembourg by the retiring court president, Bo Vesterdorf, but comprising 248 pages.

Microsoft supporters see the ruling on a case initiated nine years ago as a blow to free enterprise, innovation and intellectual property rights - and its opponents claim an encouragement to fair competition, greater consumer choice, lower prices and fundamental changes in the group's business model and practices.

Legal experts openly disagreed about how significant a precedent the ruling is but several said it opened the floodgates for complaints to Brussels about the behaviour of "superdominant" companies.

Google, Apple and IBM are among those cited as being liable to challenges because of their dominant market share. Huge continental energy groups, due to be presented with proposals to "unbundle" or sell off their transmission activities tomorrow, and even Airbus, the European plane-maker, were also mentioned.

A jubilant Neelie Kroes, the competition commissioner, turned the screws on Microsoft by calling for a significant drop in its 95% market share in PC operating systems and demanding that it fully comply with the original 2004 decision in the light of yesterday's court ruling.

"You can't draw a line and say exactly 50% is correct but a significant drop in market share is what we would like to see," she told reporters.

The ruling, she said, strengthened the commission's determination to pursue similar cases and to put consumer benefit above innovation. "This is an important precedent not just for this particular product on this particular market," she added. "We shall start to enforce. There's no escape any more."

The Dutch Liberal, a former business executive, and her officials also held out the prospect of further punishment amid reports she is considering imposing a €1bn fine for Microsoft's failure to comply with the original decision. But she said it was "too early" to discuss that and dismissed suggestions from lawyers on Microsoft's side that the ruling would make Brussels the "litigation capital" of the world.

The court's decision that Brussels wrongly imposed an independent trustee - Professor Neil Barrett of Imperial College, London - to monitor Microsoft's compliance may make her stay her hand.

Ms Kroes also made it plain she is considering further action against the world's "superdominant" software group over the new version of Windows called Vista, its Office software and other products in the wake of fresh complaints from rivals about its behaviour. She is to hold talks in Washington next week with the US justice department in an effort to buttress the latter's faltering efforts to make Microsoft comply with a lesser US court ruling in 2002.

Brad Smith, Microsoft's general counsel, said the firm was "100% committed" to complying with the commission's 2004 decision but issues of the price of licences to download protocols behind Windows and trade secrets still remained to be settled. But Ms Kroes, who described the CFI ruling as "bittersweet" because it confirmed that consumers suffer at the hands of Microsoft, repeatedly demanded swift remedial action.

Mr Smith refused to say whether Microsoft would seek to appeal to the European court of justice - possible only on points of law - but privately company advisers see this as unlikely because the judgment was based on case law and facts. They also point to Microsoft's desire to spend more time and effort competing with new rivals such as Google while striking more inter-operability deals with former opponents such as Sun and AOL Warner.

Thomas Vinje, a lawyer at Clifford Chance acting for the European Committee for Interoperable Systems, a group including IBM and Linux "open source" operators, said the CFI had set "a clear standard for Microsoft's future conduct" and showed that "no company, especially one with a superdominant position, is above the law".

A multi media player market?

What does the ruling mean for ordinary users?

Some of the software that has been ruled unfair by the European courts is focused on hardcore IT users, but most home users will already have some experience of another offending program, Windows Media Player. The vast majority of users of Microsoft's Windows operating system have this built in; by default it tries to run when users download music or video, or when they put a music CD or DVD movie into their computer.

So will I no longer be able to use Windows Media Player?

Your existing copy of Windows is unlikely to change. But the decision will probably see Microsoft remove Windows Media Player from all copies of Windows that it sells in Europe in the future. You can, however, always download the newest version of Microsoft's media player. The EU ruling might not make much difference to you if you are one of the millions of users who have already switched to rival programs such as Apple's iTunes or Nullsoft's Winamp.

Do they already offer a media player-free version of Windows?

There is a Windows "N" version, which Microsoft started selling after an earlier ruling in 2004. But it has not been promoted by Microsoft and has not sold, received almost no support and the name had to be changed after Microsoft said it wanted to call it the Windows "reduced media edition". The European commission rejected this, saying the name was intended to put customers off.

So what difference will this really make?

In the short term it might boost downloads of rival software, but the real change could come in the high-level deals made between Microsoft and Europe's major broadcasters. TV companies such as the BBC and Channel 4 use Windows Media Player as the basis for their new video downloading services. If the program is no longer available on the vast majority of PCs, that could open the door for rivals to make gains in this growing industry.